University of Vermont Department of Economics Course Outline
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1 University of Vermont Department of Economics Course Outline EC 135 Professor Catalina M. Vizcarra Time: T/TH 11:40-12:55 P.M. 342 Old Mill Room: Jeffords Hall 127 Phone: Spring 2017 Office Hours: T/TH 10:00 A.M.- 11:00 A.M. (or by appointment) Law and Economics The economic analysis of the law is a field of study that applies microeconomic theory to the study of legal rules and procedures. The course discusses the potential economic effects of a wide range of legal institutions with emphasis on the allocation of property rights. It also studies various sorts of liability rules, remedies for breach of contract, criminal law institutions like the death penalty, and whether fines or imprisonment is the most efficient way to deter crimes. Required Textbook Cooter, Robert and Thomas Ulen. Law and Economics. 6 th ed. Addison-Wesley, Inc (available online) Course Evaluation Class Participation: 30% TBA Midterm Examination 30% Th. March 2 Final Examination: 40% May 11 th (1:30-3:30 P.M.) Class participation will be evaluated through homework assignments and participation in class discussions. You will be able to drop your lowest HW assignment grade. The final exam is comprehensive.
2 How to Contact Me: The best way to reach me is by during business hours, or in person at my office during office hours. If you have a conflict with my office hours you can send me an to set up an appointment that suits your schedule. Please note that I will be communicating all important course announcements in class. Additionally, on the course s Blackboard site you will find occasional announcements, practice tests, answer keys, and other course materials. Classroom Rules Class attendance is mandatory. Students are responsible for all the material discussed during lecture. You may use your computer in class. However, all uses for your computer during class other than class related work are strictly prohibited. If I learn that you are using your computer for any other purposes you will be asked to power it down or leave the classroom. Additional Policies: Please review the following codes of conduct: Code of Student Rights and Responsibilities Code of Academic Integrity Note: It is the University policy to allow students to honor their religious holidays. Students should submit in writing by the end of the second full week of classes their documented religious holiday schedule for the semester so as to arrange for any necessary make up work in advance. 2
3 Tentative Course Outline 1. Introduction. What is the Economic Analysis of the Law? (1 class) Cooter & Ulen, chapter 1 2. Review of Microeconomics (1 to 2 weeks) Maximization, Equilibrium and Efficiency. Market Failures. Game Theory (basic concepts). Cooter & Ulen, chapter 2 3. Introduction to Legal Institutions (1 week) The Civil Law and the Common Law Traditions (basic concepts). Cooter & Ulen, chapter 3 Eisenberg, Melvin A., The Nature of the Common Law (1991). Merryman, John H., The Civil Law Tradition: An Introduction to the Legal Systems of Western Europe and Latin America (2 nd. Edition, 1985). 4. Property Rights (3 weeks) a. An Economic Theory of Property. The legal concept of property. Bargaining Theory. The Coase Theorem. Transaction Costs. The Normative Coase and Hobbes Theorems. Remedies. Public vs. Private Goods. b. Topics in Property Law. Establishing and Verifying Property Rights. Transferring Property Rights. Breaks in the Chain of Title. What may owners do with their property? Bequests and Inheritances. Using somebody else s property. 3
4 Cooter & Ulen, chapters 4, 5 Coase, Ronald. The Problem of Social Cost, Journal of Law and Economics 3 (1960). Calabresi and Melamed. Property Rules, Liability rules, and Inalienability: One View of the Cathedral. Harvard Law Review 85 (1972). Garrett Hardin. The Tragedy of the Commons, Science 162 (1968) Harold Demsetz. Toward a Theory of Property Rights, American Economic Review 57 (1967). 5. Contract Law (2 to 3 weeks) a. Contract Law. Bargain Theory. An Economic Theory of Contract. b. Topics in Contract Law. Remedies as Incentives. Formation Defenses and Performance Excuses. Cooter & Ulen, chapters 8, 9 Ayres and Gertner. Filling Gaps in Incomplete Contracts: An Economic Theory of Default Rules, Yale Law Journal 99 (1989) 6. Tort Law (2 to 3 weeks) a. Tort Liability. Economic Essence of Tort Law. The Traditional Theory. Economic Theory of Tort Liability. b. Topics in Tort Law. Extending the Economic Model. Computing Damages. Tort Law Reform? Cooter & Ulen, chapters 6, 7 4
5 Steven Shavell. Strict Liability versus Negligence, Journal of Legal Studies 9 (1980). Gary Schwartz. Reality in the Economic Analysis of Tort Law: Does Tort Law Really Deter? UCLA Law Review 42 (1994). W. Kip Viscusi. The Value of Risks to Life and Health, Journal of Economic Literature 31 (1993). 7. The Economics of Crime (2 weeks) a. En Economic Theory of Crime and Punishment. The Traditional Theory of Criminal Law. An Economic Theory of Crime. b. Topics in the Economics of Crime and Punishment. Crime in the U.S. Imprisonment or Fines? The Death Penalty. Cooter & Ulen, chapters 12, 13 Gary Becker. Crime and Punishment: An Economic Approach, Journal of Political Economy 76 (1968). Isaac Ehrlich (1996), Crime, Punishment, and the Market for Offenses, Journal of Economic Perspectives 10 (1996). Ethan Cohen-Cole, Steven Durlauf, Jeffrey Fagan, and Daniel Nagin. Model Uncertainty and the Deterrent Effect of Capital Punishment, American Law and Economics Review 11 (2009). 5
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